2026 Tax Season Guide: Essential Deadlines and New Relief

It’s officially January 2026, and if you’ve been following the news, you know the last year has been a rollercoaster for Canadian taxpayers. Between proposed hikes and new filing rules, there’s been a lot of "tax noise."

At N.I. Cameron Inc., we’ve cut through that noise to give you the bottom line. Here is the good news you need to know for this spring.

🛑 The "Headache Taxes" are on Hold

We have seen significant updates regarding two of the most confusing new rules: Bare Trusts and the Underused Housing Tax (UHT).

• Bare Trusts: On December 16, 2025, the CRA confirmed they do not expect bare trusts to file for the 2025 tax year. This is a massive relief for anyone in a "legal vs. beneficial" ownership situation. You can officially cross this off your list for this spring.

  Source: CRA Trust Reporting – What has changed

• The Federal Underused Housing Tax (UHT) is Ending: Following the November 2025 Budget, the government moved to eliminate the Underused Housing Tax for 2025 and beyond. While the law (Bill C-15) finds its way through Parliament, the CRA has updated its site to say that 2025 filings are not required. However, the provincial BC Speculation and Vacancy Tax is still in effect.

  Source: CRA Underused Housing Tax – Proposed Updates

📈 Capital Gains: The 50% Rate Remains

There was significant concern in 2025 regarding a hike in the Capital Gains inclusion rate to 66.67%.

• The Update: That proposal was cancelled.

• The Reality: The inclusion rate remains at 50% for most taxpayers. Additionally, the Lifetime Capital Gains Exemption (LCGE) has been indexed to $1,250,000 for qualified small business shares.

📅 Dates to Circle on Your Calendar

Mark these dates to avoid late-filing penalties (which start at 5% of the balance owing).

• March 2, 2026: Deadline for RRSP contributions for the 2025 tax year.

• March 31, 2026: Deadline for T3 Trust Returns.

• April 30, 2026: Personal Income Tax filing and payment deadline.

• June 15, 2026: Self-Employed filing deadline (although any tax owing is still due by April 30).

💰 2026 Contribution Limits

• TFSA: The annual contribution limit for 2026 is $7,000.

• RRSP (for the 2025 Tax Year): The deadline to contribute is March 2, 2026. The maximum contribution limit for this filing is $32,490 (or 18% of your previous year’s earned income, whichever is the lesser).

• RRSP (for the 2026 Tax Year): Looking ahead, the new maximum contribution limit has increased to $33,810.

Let’s Get Your Taxes Sorted

Tax season filing is about more than just checking boxes; it’s about making sure you understand the current legal requirements. Whether you have a complex estate or just need a hand with your personal filing, our downtown Vancouver team is here to help.

Contact N.I. Cameron Inc. today to book your appointment.

Understanding the Capital Gains Deferral and Upcoming Tax Changes

The Government of Canada recently announced a deferral in the implementation of the proposed changes to the capital gains inclusion rate, shifting the effective date from June 25, 2024, to January 1, 2026. This decision provides taxpayers—both individuals and businesses—with additional time to plan their financial strategies accordingly.

Key Highlights of the Capital Gains Inclusion Rate Change

The capital gains inclusion rate determines how much of a capital gain is subject to taxation. As per the revised timeline:

• Until December 31, 2025, the inclusion rate remains at 50% for all capital gains.

• Effective January 1, 2026, the inclusion rate will increase to two-thirds (66.67%) on:

• All capital gains exceeding $250,000 per year for individuals.

• All capital gains for corporations and most types of trusts.

Measures to Mitigate the Impact on Middle-Class Canadians

To ensure that middle-class Canadians are not disproportionately affected, the government is implementing several exemptions and incentives:

1. Principal Residence Exemption

Canadians will continue to benefit from the Principal Residence Exemption, meaning no capital gains tax will apply when selling their primary home.

2. New $250,000 Annual Threshold (Effective January 1, 2026)

• Individuals will continue to be taxed at the 50% inclusion rate on the first $250,000 of annual capital gains.

• This applies to secondary properties such as cottages, investment properties, and other assets.

• For couples, a combined exemption of $500,000 will be available when selling shared assets.

3. Increased Lifetime Capital Gains Exemption (LCGE) (Effective June 25, 2024)

• The LCGE for small business shares, farming, and fishing property will increase from $1,016,836 to $1.25 million.

• This increase ensures that business owners and entrepreneurs benefit from tax relief before the new inclusion rate takes effect.

4. Introduction of the Canadian Entrepreneurs’ Incentive (Effective 2025 Tax Year)

• A reduced capital gains inclusion rate of one-third (33.33%) will apply to up to $2 million in eligible lifetime capital gains for entrepreneurs.

• This incentive will gradually increase, reaching its full $2 million limit by 2029.

• When combined with the LCGE, entrepreneurs will see tax relief on up to $6.25 million in capital gains.

What This Means for Taxpayers

The deferral to 2026 provides individuals and businesses additional time to assess their financial plans. Key considerations include:

• Timing the sale of investments or properties to take advantage of the 50% inclusion rate before 2026.

• Maximizing exemptions, particularly the new annual threshold and the increased LCGE.

• Strategic planning for entrepreneurs to benefit from the reduced inclusion rate under the Canadian Entrepreneurs’ Incentive.

Next Steps

The federal government will introduce legislation to enact these changes in the coming months. Taxpayers are encouraged to consult with financial and tax professionals to optimize their strategies based on their unique circumstances.

If you have questions about how these changes may affect you, feel free to reach out to our team for expert tax planning advice!